Alphabet shares rose 4% on Monday as the company officially joined the Dow Jones Industrial Average, replacing Verizon and adding a symbolic blue-chip designation.
This move comes despite continued pressure on the stock. Even with Monday's gain, Alphabet is still tracking for its worst month since February of last year, with six of the past seven weeks in the red.
Investor concerns about Alphabet are centered on AI execution, with compute shortages, lower-cost Chinese models, DeepMind talent exits, and reduced buybacks raising questions about the payoff from Alphabet’s capex spend.
Alphabet reportedly does not have enough compute capacity to meet demand from enterprise customers such as Meta, and is turning to infrastructure rivals, including SpaceX, to help close the gap.
That strain is now showing up on Alphabet's balance sheet. Its cash pile is shrinking, it skipped buybacks in the first quarter for the first time in nearly a decade.
